Fulcrum Point

AAA

DEFINITION of 'Fulcrum Point'

The turning point in which a security or the economy in general makes a major change in direction. A fulcrum point can be very profitable for investors who are able to identify that a sharp price move is about to take place. For example, after the U.S. equity markets plunged in late 2008, they recovered sharply in early 2009.

INVESTOPEDIA EXPLAINS 'Fulcrum Point'

It is very difficult to predict or identify a fulcrum point contemporaneously, but the promise of very high returns keeps many investors looking for them. Unfortunately, these movements are so rare that few succeed in both predicting that a movement should occur and in timing the movement correctly. Often, what may seem initially to be a major sharp reversal may instead turn out to be just a minor movement before the major trend resumes.

RELATED TERMS
  1. Point & Figure Chart

    A chart that plots day-to-day price movements without taking ...
  2. Reversal

    A change in the direction of a price trend. On a price chart, ...
  3. Bottom

    The lowest point or price reached by a financial security, commodity, ...
  4. Payer

    An entity that makes a payment to another. While the term payer ...
  5. Inflection Point

    An event that results in a significant change in the progress ...
  6. Asset

    1. A resource with economic value that an individual, corporation ...
Related Articles
  1. Economics

    What are the differences between internal and external economies of scale?

    Take a deeper look at the differences between internal and external economies of scale, and learn why internal economies offer more competitive advantage.
  2. Economics

    What is the difference between Economic Value Added (EVA) and Market Value Added (MVA)?

    Learn how economic value added (EVA) and market value added (MVA) company valuations differ and the circumstances under which investors should consider each calculation.
  3. Economics

    Market Economy

    In a market economy, economic decisions and prices are determined by market forces rather than by central planning.
  4. Economics

    Can scarcity and surplus coexist together?

    Can surplus and scarcity exist at the same time? Many examples of redistributing wealth and corporate welfare take advantage of this phenomenon.
  5. Investing Basics

    What is the difference between macroeconomics and finance?

    Dive into the world of economics by learning the key differences between macroeconomics and finance. These ideas help investors make good choices.
  6. Economics

    Why is Keynesian economics sometimes called demand-side economics?

    Learn why Keynesian economics is sometimes called demand-side economics, and find out how government spending increases aggregate demand and encourages growth.
  7. Economics

    How does macroeconomics explain "stagflation"?

    Learn about stagflation: a macroeconomic term used to describe economic turmoil. It is a time of serious inflation, slow economic growth and high unemployment.
  8. Fundamental Analysis

    What's the difference between r-squared and adjusted r-squared?

    Learn how R-squared and adjusted R-squared values differ, how they are calculated, the relationship between them and how to use them to make accurate estimates.
  9. Personal Finance

    What is the difference between Keynesian economics and monetarist economics?

    Discover how the debate in macroeconomics between Keynesian economics and monetarist economics always comes down to proving which theory is better.
  10. Economics

    What's a Command Economy?

    A command economy is one where the government controls the economy, acting as the central planner, dictating production quotas and distribution levels, and setting prices. Such economies exist ...

You May Also Like

Hot Definitions
  1. Prospectus

    A formal legal document, which is required by and filed with the Securities and Exchange Commission, that provides details ...
  2. Treasury Bond - T-Bond

    A marketable, fixed-interest U.S. government debt security with a maturity of more than 10 years. Treasury bonds make interest ...
  3. Weight Of Ice, Snow Or Sleet Insurance

    Financial protection against damage caused to property by winter weather specifically, damage caused if a roof caves in because ...
  4. Weather Insurance

    A type of protection against a financial loss that may be incurred because of rain, snow, storms, wind, fog, undesirable ...
  5. Portfolio Turnover

    A measure of how frequently assets within a fund are bought and sold by the managers. Portfolio turnover is calculated by ...
  6. Commercial Paper

    An unsecured, short-term debt instrument issued by a corporation, typically for the financing of accounts receivable, inventories ...
Trading Center